The revenue for Whatsapp may come from a new B2C model
Earlier this week, Whatsapp surprised its 800 million customers the world over by announcing a free lifetime service. The cross-platform instant messenger app provider broke the news on its official blog about making Whatsapp free and more useful. Till now, it was charging a $0.99 annual subscription fee to continue usage after a year-long free-trial, to be paid via authorised payment gateways or Google wallet.
“For many years, we’ve asked some people to pay a fee for using WhatsApp after their first year. As we’ve grown, we’ve found that this approach hasn’t worked well. Many WhatsApp users don’t have a debit or credit card number and they worried they’d lose access to their friends and family after their first year. So over the next several weeks, we’ll remove fees from the different versions of our app and WhatsApp will no longer charge you for our service,” the blog post reads.
Around a million new customers join Whatsapp every month. Beyond working out the social networking tool, transferring copious amount of real time user-generated data plays the pivotal part in the business, particularly since Facebook acquired the service for $19 billion back in 2014. The plan was that the customers would migrate to a premium package after a year but that had not worked well with many countries.
The messenger platform history has sufficient past experiences of similar chat-up services doing away with the payment options when the system became non-viable.
Challenges On the flip-side, the social networking giant needs to try out ways to beat competitors like Slack, Wickr and Telegram. Drawing an integrated service tool would be a must-have for boosting internal communication. Telecos, in future, may stay alert, for the popularity element of Whatsapp, coupled with its simple and reliable features may cast a shadow over the bulk subscription of short messaging services (SMS) for business purposes.
New revenue model Third-party ads are a big no and this means that the plan is to have a B2C model targeting corporate establishments. “Starting this year, we will test tools that allow you to use WhatsApp to communicate with businesses and organisations that you want to hear from. That could mean communicating with your bank about whether a recent transaction was fraudulent, or with an airline about a delayed flight,” it says.
Meanwhile, Whatsapp CEO Jan Koum clarifies that the plan is still in a nascent-stage and not even a single line of code is written. The B2C service is starting the test-run in 2016. The initial phase, in all likelihood, will roll out in European countries with B-house biggies among the initial clients.
